RESP

HRSDC GRANTS OVERVIEW

GRANT TYPE
DEFINITION
ELIGIBILITY
LIMITS
Annual
Lifetime
Basic Canada Education Savings Grant (CESG) Payment of 20% on contributions made on or after January 1, 1998 in respect of an eligible beneficiary, up until the end of the calendar year in which the beneficiary turns 17.
  • Valid beneficiary SIN
  • Beneficiary is a resident of Canada
  • Special conditions apply for beneficiaries who are 16 and 17 years old. * (see below – 16/17 Rule)
 $ 500
Up to $1000 if there Carry Forward Room available**		 $ 7,200
(Basic & Additional CESG combined)
Additional Canada Education Savings Grant (CESG) Payment above the Basic CESG of an additional 10% or 20% on the first $500 or less of annual contributions made on or after Jan 01, 2005 depending on total net family income.
  • Same as Basic CESG
  • Payable only into Individual Plans or Sibling-Only Family Plans
  •  Net family income thresholds  for ACESG are indexed to inflation and updated annually.
$ 50 to $ 100 per beneficiary per year depending on total net family income $ 7,200
(Basic & Additional CESG together)
Canada Learning Bond (CLB) Incentive directed to children born on or after Jan 01, 2004 whose primary caregiver qualifies and receives the National Child Benefit Supplement. It is not dependent on contributions.
  • Children born on or after Jan 01, 2004
  • Valid Beneficiary SIN
  • Valid Primary Caregiver information
  • Beneficiary resident of Canada
  • Payable only to Individual Plans or Sibling-only Family Plans
  • Family income must not exceed  threshold for qualifying for the NCBS.
 $500 For beneficiaries born January 01, 2004 or later

$100 per year for the following 15 years if the annual income eligibility requirements are met.		 $ 2,000
Alberta Centennial Education Savings Grant or ACES Incentive directed to children born or adopted in Alberta on or after Jan 01, 2005 at the age of 8, 11 & 14 on or after Jan 01, 2005.
  • Children born on or after Jan 01, 2005 or adopted on or after Jan 01, 2005
  • Children aged 8, 11 and 14 years on or after Jan 01, 2005 and attending an Alberta school
  • Payable only to Individual Plans or Sibling-only Family Plans
  • No contribution is required to receive the $500 Grant
  • A minimum $100 contribution is required within the year immediately preceding each application to receive the $100 Grant
 $500
Grant paid at birth for beneficiares born January 1, 2 or later

$100
For beneficiaries enrolled in Alberta schools during ages 8, 11 and 14, 2005 or later. 		$ 800

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Grant Summaries:

Basic Canada Education Savings Grant (CESG)
Additional Canada Education Saving Grant (CESG)
Canada Learning Bond (CLB)
Alberta Centennial Education Savings Grant (ACES)
Quebec Education Savings Incentive (QESI)

CESG Grant Eligibility:

Children born in Canada as Canadian residents are automatically eligible for CESG from birth until the end of the calendar year in which they turn age 15.

In order to be eligible for grants for ages 16 and 17, the beneficiary must meet one of the two conditions under the HRSDC’s 16/17 rule:

*16/17 Rule:

A minimum of $100 in annual RESP contributions must have been made in any four years (and not withdrawn) before the end of the calendar year the beneficiary turned 15.

OR

A minimum of $2,000 in RESP contributions must have been made (and not withdrawn) before the end of the calendar year the beneficiary turned 15.

If the 16/17 rule is passed, the beneficiary will be grant eligible until the end of the calendar year in which they turn 17.

Grant Room

As of 1998, grant room accumulates for each Canadian resident until the end of the year in which they turn 17.

  • 1998 to 2006: $ 400 per year of grant room is provided to each beneficiary.
  • 2007 or later: $ 500 per year of grant room is provided to each beneficiary.

Grant room begins accumulation either in 1998 OR the birth year of the beneficiary, which ever year that comes later. This room accumulates for each beneficiary regardless if an RESP account has been opened for the beneficiary.

**Carry Forward

Basic CESG room that is not used in any years is commonly known as grant “Carry Forward.” This carry forward can be used in future years up to an annual maximum of $1000.00 provided the beneficiary is still grant eligible.

To find out how much grant room and carry forward is available for a beneficiary, please click here.
Important times/limits to remember:
TIME/CONTRIBUTION LIMITS
PLAN TYPE
Individual
Family
Annual Contribution Limit None None
Annual Basic CESG Limit $1,000 (provided beneficiary has adequate grant carry forward available). $1,000 per beneficiary (provided beneficiary has adequate grant carry forward available).
Lifetime Contribution Limit $50,000 $50,000 per beneficiary
Lifetime Basic and Additional CESG Limit $7,200 $7,200 per beneficiary
Contribution Time Limit Up to the 32nd year of the plan’s existence. Up to age 31 of each beneficiary.
Plan’s Existence* Can remain open for 35 years from the original contract start date. Plan must be terminated at the end of the 35th year. Can remain open for 35 years from the original contract start date. Plan must be terminated at the end of the 35th year.

* Specified Plan established for a beneficiary receiving the Disability Tax Credit may remain open until the end of its 40th year.

 

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Grant Approval Process

Mackenzie (as promoter) processes the Grant application on behalf of the client through an electronic exchange of information with HRSDC.

At the beginning of each month all RESP transactions processed in the previous month are collected and sent to HRSDC for validation and processing.

HRSDC validates and processes the data submitted and will respond back by the end of the month.


Example:

Timeframe applicable for Basic CESG, Additional CESG or ACES.

January 15, 2009
Purchase of $ 400.00
Grant requested - Basic CESG

Feb 5, 2009
Mackenzie submits all January transactions to HRSDC

Feb 5-25
HRSDC validation and approval process

Feb 26
HRSDC responds to Mackenzie submitted transactions with grant and/or reject/refusal records

Feb 27
Basic CESG posted to client account  - $ 80.00 posted to client account (43 days)

The maximum time frame for receipt of grant, Bond etc, provided all documentation and information is accurate and accepted by HRSDC is 65 days.

Timeframe applicable for Canada Learning Bond

Initial application of Canada Learning Bond follows the same timeline of the other Grants. Subsequent installments of Canada Learning Bond are paid in August thereafter, if the eligibility requirements are met.